Crude oil prices established a firmer footing above $75.00

 Gas contracts moved between gains and losses across the day

The battle between the bears and bulls continued unabated during Tuesday’s market with gas contracts moving between gains and losses across the day.  Following the significant losses from the previous session gas prices opened weaker with the front month being priced down by a penny in early trading.  Other contracts were also in negative territory as downward price pressure continued.  The market shifted direction on a number of times over the course of the day with the bulls finally winning out as contracts finished higher.  The front month August contract peaked at 88.14p and a low of 83.20p, a 4.94p spread.  August eventually closed at 87.09p, up by 2.36p.

GB power futures firmed during Tuesday’s market

GB power futures firmed during Tuesday’s market and recovered some of the losses from the previous session.  The power market continues to track the NBP gas and EUA carbon market as both recovered losses from the previous session.  The gains at the front of the power curve were modest enough compared to the movement we have seen in recent sessions. The power prompt moved in the opposite direction as the day ahead shed £6.02/MWh as wind generation was forecast to pick up in the coming days.  Renewable generation on the day came in just above the forecast at 4.9GW.  

 Crude oil prices recovered some ground on Tuesday

Crude oil prices recovered some ground on Tuesday and established a firmer footing above the $75.00 mark.  Brent crude increased by $1.33 to settle at $76.49 a barrel.  The market is once again switching its focus to the prospect of greater global demand as economies return to some sort of normality as the roll out of the covid 19 vaccine continues apace.  There remains some downside risk however with grower case number and some countries imposing more restrictions.  The market seems to be betting that despite a rise in cases, albeit among the generally healthy younger cohort, economic activity will continue to rise and oil demand will return to pre-pandemic normality.  

The gas market is moving lower this morning

The gas market is moving lower this morning with contracts shedding between 2.00p and 3.00p in early trading.  At one stage the front month contract was down by 3.36p as it changed hands at 83.83p per therm.  It has recovered some of this ground and is now priced at 85.45p, down by 1.94p from last nights close.  Prompt gas prices are displaying similar weakness as the system runs with a surplus of 10MCM on forecast demand of 128MCM.  The spot is priced at 85.40p while day ahead is down by 0.70p at 85.65p.  Crude oil markets have given some of the gains added during yesterday’s session, but Brent remains well above the $75.00 mark.